1930s Flashcards
(28 cards)
1929 election party proposals
conservatives put forth ‘safety first’ and ‘the man you can trust.’ for baldwin continuation. labour had proved credibility in 1924, hadn’t approved of general strike. not a manifesto of action, but rather a statement of principles, reorganisation of industry in the interest of all. Liberal party planned to conquer unemployment under Lloyd George. fielded 513 candidates in comparison to 340 at previous. won 6 by elections between 1927-29
1929 election results
labour 287, conservative 260, liberal 59
reason for labour success
macdonald constitution and moderate policies convinced electorate that he could be trusted. Safety first had limited appeal and many did not expect threats. Unemployment was a key issue and many believed a new government would be needed to solve it. liberals got 5 million votes but only won 59 seats.
macdonald cabinet
Snowden chancellor, Arthur Henderson foreign office, Margaret bond field minister for labour.
economic situation in 1929
staple industries in decline, high unemployment, gold standard.
policies of the labour government
housing act 1930, increased subsidies for house building and slum clearing. Coal mines act 1930, reduced working hours from 8-7.5 hours. Land utilisation act and agricultural marketing act, marketing boards established to fix prices and arrange supplies. London transport bill, public corporation established to provide cheap and efficient public transport.
impact of Wall Street crash
between 1929-31, the value of exports fell by half, unemployment rose to around 2.5 million, 3 million by end of 1932.
response to wall street crash
1930 economic advisory council set up to provide advice, more unemployment meant more benefits required, but didn’t want to lose a balanced budget. Mosley called for expansionary government spending policy, finance of public works and social reforms. MacDonald was sceptical, thought that it would reduce confidence overseas and cause more unemployment. In may 19, macdonald set up a committee to investigate how the government may reduce expenditure and restore confidence.
may committee recommendations
published 31 July, predicted a 120 million deficit unless cuts were made, recommended cuts of 96.5m, pay cuts for public sector employees (teachers, police, civil servants) 20% reduction in benefits and higher tax. macdonald accepted that benefits had to be cut. the economic committee agreed on cuts of 56million. other parties saw as too small. TUC rejected any cuts, vote agreed 11 to 9 that they could cut benefits, but split labour and macdonald had to resign.
national government formation
only three of the labour cabinet, Snowden, sankey and Thomas followed macdonald
criticism of macdonald
set up may committee instead of listening to his economic advisory committee, was slow to respond to the crisis, failed to appreciate the depth of feeling of labour of opposition to cutting benefits, ignored unions, when the split was obvious he failed to resign and instead joined with conservatives.
1931 election results
554 seats fr national government, 42 for labour
1935 election results
432 national government, 154 labour
general policies of national government
came off gold standard, limited government spending to balance budget, made a 10% cut in benefits and introduced means testing, cuts to wages of public sector employees, intervened in currency markets to stabilise the pound, lower interest rates to 2% in 1932 allowing for cheap credit.
trade policies of the national government
set up sterling areas with members using the pound rather than gold, import duties act of 1932 protected british industry, Ottawa conference 1932 imperial preference agreed, treaties made with countries including quotas for imports into britain.
industry policies
special areas act 1934, provided government aid to most depressed areas, cotton industry act 1936 closed down non profitable mills, british shipping act provided government loans for shipping companies to crap older ships and build new ones, North Atlantic shipping act provided loans to restart building of transatlantic liner queen Mary, marketing board for farmers and prices guaranteed, subsidies for farmers
chamberlain social reforms
1937 rectory act extended safety regulations under factory code from 7-11 million workers. 1938 holidays with pay act, workers had right to one weeks paid holiday, 1938 coal miners act transferred royalties for coal mined from landowners to government
reasons why britain was so badly affected by the crisis
coming back onto the gold standard made it difficult to sell goods abroad, but with tariffs from USA, this became even worse, manufacturers could not sell goods and some were bankrupted leading to job losses. trade with USA provided income to pay off debts from the war, the loss of trades toped this income and USA called in loans made after the war. Countries such as Italy were unable to repay british loans given during the war.
crisis itself
banking failures coincided with a balance of payments deficit, the recommendations of the may report caused a fall in confidence and a run on the Bank of England. in July foreign investors were withdrawing at 2.5 million a day. In august borrowed from French and Americans but run continued. national government was formed
consequences of leaving gold standard
30% devaluation meant more competitive exports. however other countries also left and depreciated too. government no longer had to use interest rates to maintain pound value, 6-2%, creating cheap money.
house building changes after 1931
low interest rates meant lots of private house building, 2 million in 1930s. provided work and demand for furniture. however houses more for middle class. also less government house building at around 700,000 from 1931-40.
tariff reform
10% tariff on all goods entering britain, free trade for empire, however after Ottawa conference, agreement for preference with lower tariffs instead of free trade.
industry in 1930s
policies such as reduced spending, benefits and wages restored confidence but lowered demand. this led to unemployment rising sharply from 1932-33. schemes to close down uncompetitive ships, mills, mines, those that survived invested more. coal mines saw more machinery. jarrow closures 70% unemployment. however economy did begin to recover especially in new industries.
new industries in 1930s
car output doubled, britain became 2nd largest car manufacturer, output of electricity quadrouples between 1925 and 1940. motor industry employed 400,000 in 1939.
